With advertising revenue becoming harder to procure, it seems that there is a crisis of confidence running through the North American newspaper market, with both U.S. and Mexican papers experiencing severe financial strain.
It has been reported that leading U.S. newspaper executives are scheduled to meet during the last week of June in New York to discuss ways to convince nervous investors that they should continue to place their money in the print industry.
Conspicuously, Wall Street Journal publisher Dow Jones & Co. Inc. is not committed to be at the meeting, as speculation mounts that it will be bought out by Newscorp Inc.
The entire industry is struggling mightily as advertisers and readers leave print for the Internet. As observers have duly noted, newspapers' online revenue growth, while still formidable, has slowed from its burgeoning rate earlier in the decade. Some observers assert that newspapers have fallen behind in the total growth rate for Internet advertising for the last several years.
The majority of newspapers' online revenue comes from an up-sell of print classifieds, and unfortunately this year's real estate classifieds -- an area of tremendous growth in 2005 and 2006 -- have fallen sharply, by about 15 percent. Employment and automotive classifieds continue to decline at roughly 10 percent a year. Thus, even in a time of deep staff cuts and very reasonable newsprint prices, the U.S. paper industry, as a whole, is falling down in earnings, profit margins and earnings per share.
Things appear to be even worse in neighboring Mexico, with The Herald Mexico, a daily English-language newspaper published in Mexico City suspending publication on June 1. 'Economic considerations' were cited as the reason given for the paper's closure.
The Herald began production in February 2003, soon after a Mexican-owned English-language daily, The Mexico City News, went out of business after 53 years of publication. The Herald was a collaboration between The Miami Herald of Miami, FL, and El Universal, a popular Spanish-language newspaper also published in Mexico City.
In a 'good-bye' notice on the front page of the Thursday, May 31 edition, the paper said 'thank you' to loyal readers and supporters. Regarding the closure, the notice said: "The global paper industry is currently going through important changes. In many instances, economic pressures have forced print newspapers and magazines to close down or make drastic changes to stay afloat. The Herald Mexico is no exception."
However, the good-bye notice signaled that there is a chance for a possible comeback in the future by stating: "There is a definite need for an English-language newspaper in Mexico that serves expats, English-speaking visitors and Mexicans who either speak or want to perfect their English. We hope this message will not be a definitive adis."
As reported in the Mexican weekly, Guadalajara Reporter, the Herald's management is currently putting out feelers for a new publishing partner.
Matthew Paolini is
Citybook.com's technical director for the
Las Vegas, NV online Yellow Pages division.
